The iwi initially supported the Waitara Lands Bill drafted by the New Plymouth District and Taranaki Regional Councils to help resolve grievances over land confiscated in the 1860s.

If passed, it would allow the freeholding of 780 leasehold properties, while returning about 60ha of reserve land to the iwi. Another 16ha would become available to the iwi for development.

The land was confiscated following a disputed land purchase at the Peka Peka block, which led to the outbreak of the Taranaki Land Wars at Te Kohia Pā in 1860.

In its submission to the Māori Affairs Committee, Te Ātiawa's post-settlement trust Te Kotahitanga o Te Atiawa said it no longer supported the bill.

It said the bill was not in the best interests of Te Ātiawa, and iwi members and Waitara hapū members were overwhelmingly against it.

The iwi said the original non-binding Heads of Agreement with the district did not allow it enough time to consult with iwi members and it was not directly involved in the drafting of the bill.

Its preference was to have more land returned, but the council determined what land was available for transfer, it said.

Te Ātiawa said it made submissions to council when it was publicly notified, but most of the amendments it suggested were not adopted.

The iwi said there was a still lot of ignorance about what had happened at Waitara.

"It has become clear to the trustees that the history of the Waitara lands and the injustices suffered by the Te Ātiawa people as a result of the loss of their lands is not well understood by local people living on those lands, the two councils or the New Zealand public."

The iwi said, apart from a brief mention in the preamble, the bill missed a prime opportunity for peace and reconciliation to be an integral part of the Waitara lands freeholding process.

Dozens of people to give submissions on bill

The Māori Affairs Select Committee heard submissions on the bill in New Plymouth today.

There have been 114 submissions made and 53 submitters have asked to be heard.

Leaseholder Jonathan Marshall told the committee he was in support of the bill - with reservations.

Mr Marshall said that leaseholders had been told for decades that the option of freeholding would be given to them and he hoped that would be realised.

"It is as if the leaseholder has had this carrot dangled in front of them."

But he disagreed with the pricing mechanism which meant it would cost a leaseholder about $100,000 to freehold a property.

Mr Marshall said the $23 million price offered to Te Ātiawa for the leasehold land during its treaty negotiations was more appropriate.

That would price the sections at about $30,000.

Te Ātiawa decided not to buy the leasehold properties, because the $23m would have come out of its $87m settlement.

Leonie Pihama Photo: RNZ / Robin Martin

Leonie Pihama, a research director at Waikato University, told the select committee hearing that the land should be returned to Waitara hapū with no strings attached.

She said the councils had no right to sell land that was stolen by the Crown in the first place.

"That land needs to be transferred to the Ōtaraua and Manukorihi hapū because we are not talking about operating at a iwi level through the treaty settlement process, we're talking about operating at a hapū level."

Dr Pihama, whose family have lived on leasehold land at Waitara for 50 years, said the council should also compensate the community.

"I think there is a different process that needs to be put in place that enables the recognition and the return of the whenua to the hapū, but that also calls for council to make some form of compensation given the huge income stream they have taken from one of the poorest communities in New Zealand."

Complex and competing interests - New Plymouth District Council

New Plymouth District Council chief executive Barabara McKerrow said there were very complex and competing interests in the Waitara land.

"Te Atiawa, the leaseholders and the community of Waitara hold long-standing views that are historical, cultural, emotional and financial.

"Some in Te Atiawa say the land should be transferred to them as it was confiscated by the Crown. The leaseholders have long wanted security and certainty over their homes and future livelihoods."

Ms McKerrow said the council and its predecessors had been asked to address this for 50 years, and had legal obligations requiring it to manage the leases and use the proceeds for very specific purposes.

"We believe this bill presents a once in a generation chance to connect all of these interests, acknowledge the past, but most importantly move forward as a prosperous and united community."

Ms McKerrow was aware that Te Ātiawa had withdrawn its support for the bill but did not want to comment further.

Te Kotahitanga trustees did not return RNZ calls today.

The trust is expected to talk to its submission at a second select committee hearing scheduled to take place in Waitara in the new year.